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Heading Towards 1.5ºC - Impacts on Labor Demand in Selected Countries

Washington, DC: World Bank

🛡CC BY 3.0 IGOPermitted use with attribution

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Shared byBhargav Iyer›

Abstract

The United Nations Climate Change Conference (COP28) closed with a statement signaling the beginning of the end of the fossil fuel era, a just and equitable transition, deep emissions cuts, and scaled-up finance. Decarbonization and green transition more broadly are recognized as essential to green recovery and will inevitably be implemented, but governments struggle with the how and when and how to pay for policy questions. Often, the green transition is seen more as a challenge than an opportunity for development. One policy instrument to move to a low-carbon pathway is a carbon tax, which would disincentivize carbon-intensive activities, and the revenues generated could be recycled to finance climate actions. When climate actions, such as renewable energy investments and energy efficiency programs, are designed in a way that stimulates job creation, a double dividend can be achieved: lower emissions and more jobs. The paper assesses different policy designs around a carbon tax regime and shows simulation results for direct and indirect implications for jobs using the MINDSET model, a price endogenous MRIO hosted by the World Bank.

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